Shein et Manus

Shein and Manus: Chinese in Spite of Themselves.

– Why “Identity Washing“ in Singapore is no longer enough.

Since 2022, a trend has taken hold among unicorns of Chinese origin: the “Great Legal Decoupling“. The pattern is now standardised: a company born in Nanjing or Wuhan moves its headquarters to Singapore, reorganises its holding company in the Caymans and works hard to smooth its image to become a “global tech company”.

This is the concept of “Identity Washing” (or “Singapore Washing“): an attempt to mask an organisation’s real origin through administrative relocation, without any substantial change to its operational foundations. But in early 2026, the facts are catching up with the legal structures. The Shein and Manus cases show that neither regulators (SEC, MOFCOM) nor public opinion are fooled any longer.

A company’s DNA is defined by its supply chain, its intellectual capital and its talent pool. A Singaporean certificate of incorporation is just an address; it is no longer a shield. For investment and advisory professionals, ignoring this dissonance between form and substance is no longer mere negligence — it is a major strategic risk.

---

Part I: The Test of Facts. The Failure of Neutrality via a Singapore Headquarters

1. The Shein Case: Harsh Reality versus International Ambition

Shein’s story is that of an attempted transformation colliding with its own infrastructure. Founded in Nanjing (China) in 2008 under the name ZZKKO, the company officially moved its headquarters to Singapore in 2022. The goal was clear: to step outside Chinese jurisdiction in order to expand more effectively in the global market and pave the way for a massive IPO on Western markets.

The field test: the BHV Marais incident in Paris (November 2025)

The opening of a permanent flagship at the heart of BHV Marais in Paris was meant to complete Shein‘s strategic makeover, validating its transformation from an ultra-fast-fashion player into a Western “lifestyle” brand. This partnership, actively backed by the Société des Grands Magasins (SGM), BHV’s new owner after its acquisition from the Galeries Lafayette group, was part of a turnaround plan for this struggling historic department store.

• Yet this alliance acted as a brutal revealer of ethical asymmetry. Beyond the public protests, the most critical alarm bell came from within the luxury ecosystem itself: several heritage houses renting space at BHV entered into discussions to terminate their leases. They refuse to be associated, through physical proximity, with a model deemed incompatible with their ESG (Environmental, Social and Governance) standards.

• This image crisis also triggered an outright break with the original seller: the Galeries Lafayette group ultimately refused to grant SGM the right to use the “Galeries Lafayette” banner for its other affiliated stores, leaving the buyer isolated with its strategic choices.

The capital markets dead end

2025 marked the end of financial illusions for Shein. After seeing its road to New York blocked by an SEC demanding supplier transparency, Shein attempted a strategic retreat to the London Stock Exchange. However, transatlantic political pressure forced the British regulator to adopt a stance of extreme caution. The reason is always the same: the Singapore domicile is deemed “non-substantive” given a supply chain in which 100% of the value added comes from Guangdong and its network of 5,000 ultra-integrated suppliers.

Insight: Shein markets itself as a “global fashion tech company“, but the market sees only an offshoot of the Chinese textile industry, whose image remains negative and some of whose practices are not accepted.

---

2. The Manus Case: Technology Held Hostage in the “Tech War“

If Shein illustrates the limits of image, the agentic AI start-up Manus embodies the limits of corporate law when confronted with intellectual property. Manus’s rise rests on a strategic pivot between three hubs, reflecting constant evolution in pursuit of access to capital and resources:

• In Wuhan (China) in 2022, the start-up laid its technological foundations through discreet R&D on the GAIA architecture.
• In 2023, it moved to Beijing, at the heart of the Zhongguancun ecosystem, to raise large amounts of funding and recruit elite deep learning engineers.
• The decisive turning point came in 2024 with the establishment of its global headquarters in Singapore. This choice allowed Manus to launch its globalisation under the manus.ai entity, ensuring international compliance and direct access to global computing resources.

The Blocking of the Meta Deal (January 2026)

At the end of 2025, Meta (Mark Zuckerberg) announced the acquisition of Manus for an amount close to 2 billion dollars, according to the financial press. Meta considered the asset relatively “clear” of Chinese political risk, since Manus was officially based in Singapore and had no direct Chinese state shareholding in its capital.

In January 2026, however, China’s Ministry of Commerce (MOFCOM) opened a formal review procedure and de facto froze the transaction by subjecting it to examination under Chinese law on export controls and national security for sensitive technologies.

The argument put forward by Beijing, as reported by several media outlets, is highly targeted: what matters is not only the jurisdiction of the headquarters or the CEO’s nationality, but the fact that Manus’s algorithms and models originate from R&D work carried out in China by locally trained teams and talent.

Insight: For regulators, an algorithm has an indelible nationality of origin. In this context, Singapore is nothing more than a powerless letterbox. For Beijing, Manus remains a national strategic asset.

---

Part II: Contagion – Risk Analysis

The attempt to mask one’s real identity creates an instability that spreads to all of the company’s partners.

1. Reputational Risk

The Shein/BHV case is a case study in contagion risk for the local partner. The SGM group analysed Shein from a purely financial angle (solvency, customer footfall), omitting any analysis of the brand’s deeper DNA.

• Collateral damage: By partnering with an entity engaged in “Identity Washing“, the partner (BHV) absorbs that entity’s reputational risk. The brand image of BHV, a pillar of Parisian heritage, has been tarnished by this association.
• Customer reaction: The insecurity created for the other tenants shows that ignorance of a partner’s real origin can lead to long-term asset impairment.
• Potentially the most serious consequence took the form of a breakdown of trust with the original seller: the Galeries Lafayette group. In response to an alliance it deemed degrading, the group revoked the right to use the “Galeries Lafayette” brand for SGM’s other affiliated stores.

2. Regulatory and Financial Risk

In the Manus case, “Singapore Washing“ creates a false sense of legal security, which is a “wake-up call“ for Private Equity funds and strategic buyers,

• The Exit dead end for investors (“Early Investors”): The Manus case shows that an acquisition can be blocked unilaterally by a third-party State (China) even if the target is legally foreign to that State.
• Collapse of multiples: An asset that can only be sold to Chinese players (BATX), because Western buyers fear MOFCOM blockages, sees its valuation cut by a factor of two or three. The investor may end up with an illiquid asset, a prisoner of geopolitics that it had not factored into its valuation model.
• The acquisition dead end for acquirers (“Buyers”): any non-Chinese acquirer must anticipate that a MOFCOM review can suspend closing indefinitely, regardless of the will of both parties. The risk of a deal collapsing is no longer contractual; it is geopolitical.

---

Part III: Strategic Adjustment – MadameChina’s Recommendation

The era of legal complacency is over. M&A and strategy professionals must adopt new Due Diligence standards. Here is our audit grid for assessing a target’s real identity.

1. The “Identity Risk” Due Diligence Checklist

You will also find a summary of MOFCOM’s (China) technology export restrictions, together with our strategic recommendations on technology transfer, in our previous note entitled “The Era of Reverse JVs” (subscriber access)

2. Recommendations for Local Partners (BHV-Type)

It is now necessary to carry out “Reputational Due Diligence” that goes beyond the legal framework:

• Opinion Monitoring: Assess the brand’s perception not as a Singaporean entity, but as its entity of origin. If the dissonance is too great, the risk of a boycott is structural.
• On-the-ground ESG audit: Do not rely on the Singapore holding company’s annual reports; commission third-party audits directly in the Guangdong factories.

---

Conclusion: DNA Cannot Be Offshored

The lesson of 2025 and early 2026 is crystal clear: corporate law can no longer mask operational reality. Identity Washing is a short-term solution that ends up turning into a liability at critical stages (IPO, M&A, physical expansion).

A company’s DNA is defined by what it does and where it does it, not by the address printed on its letterhead. For decision-makers, clear-sightedness means treating these “nomadic companies” for what they really are. Lasting success in Western markets will not come from a change of headquarters, but from a deep transformation of the supply chain and of technology governance.

The time has come for radical transparency. Those who continue to bet on legal opacity are exposing themselves to major setbacks in terms of valuation and reputation.

---